Tenet Engineering, Incorporated operates two user divisions as separate cost objects. To determine the costs of each division, the company allocates common costs to the divisions. During the past month, the following common costs were incurred: Computer services (85% fixed) Building occupancy Personnel costs Total common costs The following information is available concerning various activity measures and service usages by each of the divisions: Division A 25, 200 $ 453,000 Area occupied (square feet) Payroll Computer time (hours) $ 268,000 658,000 108,000 $ 1,034,000 Computer storage (megabytes) Equipment value Operating profit (pre-allocations) 320 5,400 $ 296,000 $ 735,000 Division B 50,400 $ 253,000 340 0 $ 346,000 $ 675,000 If common computer service costs are allocated using computer time as the allocation basis, what is the computer cost allocated to Division B? Note: Do not round intermediate calculations.

Tenet Engineering, Incorporated operates two user divisions as separate cost objects. To determine the costs of each division, the company allocates common costs to the divisions. During the past month, the following common costs were incurred: Computer services (85% fixed) Building occupancy Personnel costs Total common costs The following information is available concerning various activity measures and service usages by each of the divisions: Division A 25, 200 $ 453,000 Area occupied (square feet) Payroll Computer time (hours) $ 268,000 658,000 108,000 $ 1,034,000 Computer storage (megabytes) Equipment value Operating profit (pre-allocations) 320 5,400 $ 296,000 $ 735,000 Division B 50,400 $ 253,000 340 0 $ 346,000 $ 675,000 If common computer service costs are allocated using computer time as the allocation basis, what is the computer cost allocated to Division B? Note: Do not round intermediate calculations.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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